Saudi Arabia reported a budget deficit of SAR30.235 billion ($8.06 billion) in the third quarter of 2024, more than half of the country’s total deficit of SAR57.962 billion so far this year, as lower oil prices weighed on revenue while spending surged. However, Saudi Arabia’s budget deficit declined last quarter compared to $9.5 billion in the third quarter of 2023 when oil revenues declined sharply.
The Ministry of Finance‘s latest report revealed that Saudi Arabia’s government revenues rose 20 percent year-on-year to SAR309.208 billion, while expenditures increased by 15 percent to SAR339.443 billion.
Government oil revenues surge
Oil revenues gained 30 percent in Q3 of 2024 year-on-year to SAR190.866 billion while non-oil revenues rose 6 percent during the same period to SAR118.342 billion. Since the beginning of 2024, oil revenues reached SAR585.777 billion while non-oil revenues reached SAR370.456, making total government revenues for the first three quarters of 2024 SAR956.233 billion.
In Q3, taxes on income, profit, and capital gains declined 27 percent annually to $6.014 billion while taxes on goods and services rose 5 percent to $73.943 billion. Other taxes witnessed the strongest growth in Q3, reporting a 69 percent expansion to SAR5.311 billion.
Expenditures rise 6 percent
As for expenditures, Saudi Arabia’s government spent SAR339.443 billion in Q3 2024, up 15 percent year-on-year. Compensation for employees accounted for the largest share of government expenses in Q3 at SAR138.627 billion, up 6 percent annually.
Expenditures on goods and services rose 15 percent annually to SAR82.694 billion, while capital expenditures on non-financial assets rose 17 percent to SAR48.15 billion. A notable increase in Saudi Arabia’s budget expenditures was the 100 percent surge in subsidies to SAR7.438 billion and the 20 percent increase in social benefits to SAR21.13 billion.
So far this year, Saudi Arabia’s budget expenditures reached SAR1.014 trillion, up 13 percent compared to the first three quarters of 2023.
The ministry also revealed that the government’s current account balance reached SAR76.67 billion by Q3 of 2024 while government reserves hit SAR390.079 billion. Moreover, public debt at the end of the third quarter reached SAR1.157 trillion, with domestic debt at SAR688.718 billion and external debt at SAR468.918 billion.
Oil prices impact Saudi budget
Saudi Arabia’s national oil company Aramco’s net income fell by around 15.3 percent during the third quarter of 2024, in line with analyst consensus. Aramco attributed the profit drop to lower crude oil prices and weakened refining margins. The decline in oil prices in addition to voluntary output cuts continues to impact Saudi Arabia’s budget.
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